Chris Wetterich
09/13/22
Key Points:
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End Citizens United recently filed an ethics complaint against Representative Steve Chabot and requested an investigation after allegedly not disclosing a stock trade that took place after a pharmaceutical company acquired another drug company.
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Chabot disclosed his trade of up to $15,000 in AbbVie stock for Allergan stock more than a year after it occurred.
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In 2020, drug maker AbbVie acquired Allergan for $63 billion. Chabot owned up to $15,000 of Allergan stock, which was exchanged for AbbVie stock on May 8th, 2020, according to a “periodic transaction report” filed in July of 2021. The merger was announced in 2019.
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A 2012 congressional ethics law known as the STOCK Act requires members to report individual security transactions of more than $1,000 between 30 and 45 days after the transactions, depending on the circumstances, according to the complaint.
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In the periodic transaction report, Chabot wrote, “I was not aware of this transaction until preparing to file my financial disclosure forms, which I filed today, July 28, 2021.”
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The annual financial disclosure form is a different set of paperwork required to be filed by members of Congress.
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Chabot fixed the error in 2021 when he reviewed a monthly statement from his passive brokerage account. He contacted the ethics committee to get guidance on how to fix it.
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End Citizens United’s research staff discovered the issue, and there was no coordination with Democrats or Landsman, Muller told the Business Courier. The group rejects any claim that Chabot did not know about the stock trade, given that Allergan stockholders were notified about the merger, Muller said.
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End Citizens United favors banning members of Congress trading stocks. The penalty for such a violation is typically a fine of a few hundred dollars.
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“That doesn’t necessarily reflect the severity of the violation. We need to strengthen the law,” Muller said. “We know that the public has lost trust in Congress and believes too many members of Congress are just working for themselves instead of the American public. These rules are in place because we have to have processes in place to smoke out corruption so the public can hold members of Congress accountable.”
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